Two points and a US$250,000 fine

The International Jury for the 34th America's Cup today announced its verdict over the cheating scandal that followed the discovery that Oracle Team USA's AC45s, including one campaigned by Ben Ainslie Racing, were out of class and had deliberately had their kingposts (dolphin strikers) lengthened and filled with lead to varying degrees to enhance performance, the Jury found.

The Jury, comprising David Tillett (Chairman), John Doerr, Josje Hofland, Graham McKenzie and Bryan Willis, was asked to rule on two matters relating to this incident: one with regard to Article 60 of the Protocol that covers 'protecting the reputation of the America's Cup', while the other was a Rule 69 hearing over 'allegations of gross misconduct', relating to members of Oracle Team USA.

In the former the Jury's verdict was that Oracle Team USA be 'penalised one point for each of the first two races of the Match in which they would otherwise score a point.' This penalty will be applied to the scoring for the 34th America's Cup competition which kicks off this Saturday and is a 'best of 17' (ie originally a first to nine points) competition.

Oracle Team USA has also been ordered to pay a fine of US$250,000 to charity with half going to the Andrew Simpson Sailing Foundation and the remainder to a charitable organisation selected by the Mayor of San Francisco to provide support to at-risk youth in the San Francisco Bay area.

The verdict on the Rule 69 hearings has resulted in Oracle Team USA's long term wing trimmer and Spithill crew, Dirk de Ridder, being banned from further participation in the 34th America's Cup. This is also the case for Australian rigger Bryce Ruthenberg and New Zealand boat builder Andrew Walker. Matt Mitchell has been excluded from sailing a yacht in the Cup until four races have been completed. Trimmer/grinder Kyle Langford got off with a warning. The case against another member of the Oracle Team USA sailing team, 'Sailor X', was dismissed.

The Jury will be informing the relevant National Authorities and ISAF, who "may impose further penalties" given the misdemeanours of the sailors mentioned. However the jury recommended that no further action be taken in the cases of Bryce Ruthenberg and Matt Mitchell and they would not be reporting Kyle Langford.

Following the verdicts, Oracle Team USA issued the following statement: 'Today, the America’s Cup Jury announced that one Team USA sailor, our primary wing trimmer, and two shore crew have been excluded from further participation in the 34th America’s Cup. This penalty was assessed because of a rules breach occurring in early 2012, well over a year ago, involving modifications to the team's AC45 yachts, not the larger AC72 yachts that will be used in the America's Cup.

'The Jury has also penalized the team by deducting two races from Team USA in upcoming the 34th America’s Cup. That means Team USA will have to win 11 races to win the America's Cup while Team New Zealand will only have to win nine races.

"The rules infractions involved only a few of our 130 team members, and were done without the knowledge of either our team's management or the skippers who were driving the boats," said team CEO Russell Coutts. "While we disagree with the unprecedented penalties imposed by the Jury, we have no choice but to make the necessary changes to personnel on our race boat and do our best to use the next four days for the new team to practice and get ready for the start of the 34th America's Cup."

Five incidents

The cheating came to light as the AC45s were being remeasured prior to the Red Bull Youth America's Cup and was formally brought to the Jury's attention on 4 August by Oracle Team USA's rule advisor Richard Slater.

The boats out of class were Oracle Racing Team Spithill, Oracle Racing Team Coutts and BAR.

- A Kevlar bag containing lead tailings was placed inside the forward king post on Oracle Racing Team Spithill at the Newport regatta.
- Heavy ferrous tailings in a plastic bag found inside the main king post in Oracle Racing Team Spithill.
- Lead tailings and resin were added to the forward king post on BAR.
- The lengths of the main king posts used on Oracle Racing Team Spithill and Oracle Racing Team Coutts were found to having been extended by the addition of 8mm carbon composite plate without receiving authorisation from the Measurement Committee.
- Top end fittings with 80mm spigots were found fitted to the main king posts of Oracle Racing Team Spithill and Oracle Racing Team Coutts. All other boats that raced in the ACWS regattas were found to have fittings with 15mm spigots. No permission was sought of the Measurement Committee to change the spigots as is required by the AC45 Class Rule.

In addition the main kingpost on BAR was found to weigh 1.456kg (compared to 1.44- - ie it was stock) and was the standard length of 500mm. However on OTUSA Coutts it weighed 1.827kg and was 507mm long (internal depth 426mm compared to the standard 485mm), while on OTUSA Spithill it was 509mm long and weighed 2.985kg. On OTUSA Coutts and Spitill, the spigots at the top of the main kingpost weigh 0.325kg more than the standard fitting.

As the Measurement Committee report of 15 August states: "The upper fitting of the main kingpost on Oracle Spithill 4 was removed, and a discolored plastic bag whose top was secured with multiple cable ties was found.... This bag was so tightly wedged into the kingpost that it could not be removed intact. The bag was punctured by the Regatta Director, and a small quantity of granular material was removed. This material was subsequently tested by the Measurement Committee and found to be ferrous in nature (i.e. it was attracted by a magnet)."

60.1

Ironically Article 60.1 of the Protocol for the 34th America's Cup was brought into as an amendment to the Protocol in November 2011 which Emirates Team New Zealand maintain was to effectively 'gag' their boss Grant Dalton from making disparaging remarks about the event. Most of 60.1 governs what those involved with the event 'say', but there is one crucial part of it that governs actions rather than words: "....Competitor shall not...engage in any other act or conduct or any activity, in each case, on or off the water, that is prejudicial or detrimental to or against the welfare or the best interests of the America’s Cup, or the sport of sailing, or that may impair public confidence in the honest and orderly conduct of the America’s Cup, any Event, or in the integrity and good character of any Competitor, Official, selected venue, sponsor or other commercial partner of the America’s Cup."

Oracle argued that bringing sanctions against them would breach Article 60.1, that article 60.1 only applies to public statements, that only a small number of individuals within the team were responsible (ie not the whole team), and that dealing with this case at the most critical time in the build-up to the 34th America's Cup had already impacted them significantly.

Counter-arguing, Emirates Team New Zealand provided an engineering report from their Technical Director Nick Holroyd demonstrating the advantages of a long kingpost (15% more forestay load, etc). They compared the incident to corporate disputes where even if a company is not at fault thanks to the actions of its staff, it is nonetheless responsible. The team maintained that it, as well as media and AC observers, believed the episode to have damaged the reputation of the America's Cup.

Interestingly Grant Simmer, General Manager of Oracle Team USA stated in his evidence that his team is damaged in reputation, in terms of the outside sailing world, owners and sponsors. "Sponsors had not pulled out, but Oracle [Inc] is really upset‟. He believed 'their name has definitely been damaged'.

ISAF submitted that "the integrity of the competitors must be kept at the highest standards ... any breach in the rules seriously damages the reputations of those involved with the Cup and is detrimental to the welfare and best interest of the event and the sport of sailing.' They submitted that 'competitors in the America's Cup are heroes and role models for the youth of the world and they have a great responsibility towards the sport of sailing."

There is also the feeling that those team members named in the Rule 69 allegation may not have been alone. They are perhaps even scapegoats. The findings state: "The Jury failed to discover which individuals were responsible for all the breaches, resulting in concerns there may have been more. For example, there was evidence of a bag of lead being inserted into a king post but no evidence of who removed it or what happened to it. There were emails referring to 'fill king posts' as if there was an intention to fill both king posts on boat BAR, but no evidence as to whether one king post was filled and emptied."

During the course of the hearing Oracle Team USA itself acknowledged that it had not found the answers to the questions arising from the 'five' incidents. They believed they had taken the required action to identify the relevant people. OTUSA's Counsel submitted that the team had tried to get answers but there was one person who should know the answer. He submitted the person was 'not cooperative' and they did not think they were going to get any more answers and the person was "currently suspended and will go‟. OTUSA has no plans to continue their internal investigation as they do not believe they can take the matter further.

Rule 69

The allegations of Gross Misconduct brought against the sailors were as follows:

Dirk de Ridder, OTUSA sailing team member, was involved in giving instructions and/or directions to shore crew to add weight into a king post of AC45 boat 4, or was aware that such weight had been added, contrary to the AC45 Class Rule.

Sailor X1, OTUSA sailing team member, was aware that shore crew added weight into a king post of AC45 boat 4, and he was, or should have been, aware this action was contrary to the AC45 Class Rule.

Bryce Ruthenberg, OTUSA shore crew member, was involved in the addition of weight into a king post of at least one AC45 in contravention of the AC45 Class Rule and was aware this action was contrary to the AC45 Class Rule.

Andrew Walker, OTUSA shore crew member, was involved in the addition of weight into a king post of at least one AC45 in contravention of the AC45 Class Rule or was aware that such weight had been added and was, or should have been, aware this action was contrary to the AC45 Class Rule.

Kyle Langford, OTUSA shore crew member, and sailor on Ben Ainslie Racing (BAR) in the final three AC45 Series, was involved in the addition of weight being inserted into a king post of at least one AC45 in contravention of the AC45 Class Rule and was aware this action was contrary to the AC45 Class Rule.

Matthew Mitchell, OTUSA shore crew member, was involved in the addition of weight being inserted into a king post of at least one AC45 in contravention of theAC45 Class Rule and should have been aware this action was contrary to the AC45 Class Rule.